Tesla has cancelled a much-discussed inexpensive EV, however it’ll proceed to develop autonomous automobiles based mostly on the identical platform, Reuters reported Friday, citing three nameless sources conversant in the matter.

Two sources informed Reuters they realized of the choice to desert the inexpensive EV, considered a crossover concentrating on a $25,000 base worth, in a big assembly that one mentioned occurred in late February. That particular person mentioned Tesla CEO Elon Musk has instructed Tesla to “go all in on robotaxi.”

Tesla Mannequin 3

The third supply additionally informed Reuters that the inexpensive Tesla EV had been cancelled, including that the automaker was now planning to provide the autonomous robotaxis in a lot smaller volumes than had been anticipated for the inexpensive crossover, which might have considerably undercut Tesla’s present most cost-effective automobile, the Mannequin 3, which begins at just below $40,000.

Reuters additionally reported that inner Tesla messages referenced the choice to cancel the entry-level mannequin. One from March 1 from an unnamed supervisor on this system reportedly mentioned the entry-level mannequin’s scrapping with engineering workers and suggested them to carry off on telling suppliers “about program cancellation.”

BYD Atto 3

The report was considerably edited after its unique publication, together with a reference to a publish from Musk on the social-media web site X accusing Reuters of mendacity.

Reuters speculates that Musk’s delay in committing to an entry-level mannequin has made launching one a lot more durable on account of elevated competitors from Chinese language automakers. Whereas Tesla labored on launching the Cybertruck and Musk targeted extra on his different companies, Chinese language automakers doubled down on inexpensive fashions, grabbing market share in China and Europe and weakening the enterprise case for a low-margin $25,000 EV, Reuters causes.

Musk in 2020 mentioned Tesla’s next-generation platform would make a $25,000 EV attainable. And simply earlier this 12 months Reuters reported that Tesla was telling suppliers that it needed to start out manufacturing on a automobile based mostly on this next-generation platform in 2025.